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2014 First Half-year report of TVK Group

2014 First Half-year report of TVK Group STATEMENTS IN THIS REPORT ARE UNAUDITED 1 TVK Group financial results Q1 2014 Q2 2014 Q2 2013 restated YoY % …

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Page 1: 2014 First Half-year report of TVK Group STATEMENTS IN THIS REPORT ARE UNAUDITED 1 TVK Group financial results Q1 2014 Q2 2014 Q2 2013 restated YoY % …

2014 First Half-year report of TVK Group

Page 2: 2014 First Half-year report of TVK Group STATEMENTS IN THIS REPORT ARE UNAUDITED 1 TVK Group financial results Q1 2014 Q2 2014 Q2 2013 restated YoY % …

2014 FIRST HALF-YEAR REPORT OF TVK GROUP

Tisza Chemical Group Public Limited Company (TVK Plc.) (Reuters: TVKD.BU, website: www.tvk.hu) today announced its 2014 second quarter and half-year management report. This report contains a set of unaudited, consolidated financial statements for the year ended 30 June 2014 as prepared by the management in accordance with IFRS (International Financial Reporting Standards).

TABLE OF CONTENTS

TVK Group financial results ..................................................................................................................................... 1

Financial overview ................................................................................................................................................... 2

Profit and Loss Statement ....................................................................................................................................... 2

Balance sheet figures .............................................................................................................................................. 3

Cash flow ................................................................................................................................................................. 3

Headcount ............................................................................................................................................................... 3

Capital projects ....................................................................................................................................................... 4

Major events for the period between June 30 and July 31, 2014 ............................................................................ 4

Our major strategic goals ....................................................................................................................................... 4

Integrated Risk Management ................................................................................................................................. 5

Unaudited, Consolidated Financial Statements prepared in accordance with International Financial Reporting Standards ................................................................................................................................................................ 6

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FINANCIAL STATEMENTS IN THIS REPORT ARE UNAUDITED 1

TVK Group financial results Q1 2014 Q2 2014 Q2 2013

restated YoY %

(IFRS) in HUF million H1 2013 restated

H1 2014

Ch. %

100,574 98,931 98,752 - Net sales 196,005 199,505 2

8,537 10,519 7,149 47 EBITDA 12,781 19,056 49

5,189 7,323 3,799 93 Operating profit/loss (-) 5,976 12,512 109

(762) (555) 4 - Profit/loss of financial transactions (-) (1,886) (1,317) -

3,363 5,034 2,656 - Shareholder’s net profit (loss) 2,677 8,397 -

(877) 21,241 1,726 - Operating cash flow (1,467) 20,364 -

Q1 2014 Q2 2014 Q2 2013

restated YoY %

(IFRS) in EUR million H1 2013 restated

H1 2014

Ch. %

326.6 323.4 333.9 (3) Net sales 662.0 650.0 (2)

27.7 34.4 24.2 42 EBITDA 43.2 62.1 44

16.9 23.9 12.8 87 Operating profit/loss (-) 20.2 40.8 102

(2.5) (1.8) 0.0 - Profit/loss of financial transactions (-) (6.4) (4.3) -

10.9 16.5 9.0 - Shareholder’s net profit (loss) 9.0 27.4 -

(2.8) 69.4 5.8 - Operating cash flow (5.0) 66.3 - Note: Calculated on the basis of the average mid FX rate quoted for the period by the National Bank of Hungary. Note to the report: Since December 2013, foreign exchange differences on trade debtors and creditors were reclassified from operating results to financial results. According to this, profits of the comparative period of H1 2013 were restated.

Data of the profit and loss statement are reported compared to the same period of the preceding year, while balance sheet and cash flow figures are analysed compared to the end of the last year.

Mr. Zsolt Pethő, TVK CEO commented: "We are very proud that a very successful quarter followed the first one. 2014 H1 result is the highest half year operating profit since 2007. This profit is a result of systematic implementation of the actions contributing to the operational efficiency, besides favourable exchange rates, decreasing energy prices and non-recurring incomes. We could solve difficult tasks in this quarter as well. We successfully finished the planned technology cleaning and maintenance shutdowns in three units, free of accident and according to the schedule. Market expectations show favourable outlook for the future. We are committed to continue the efficiency improvement process. We believe, that based on our achievements, we can maintain our achieved results: we expect positive operating profit in the next quarter again.” The HUF 12.5 billion operating profit reached in the first half of 2014 was higher by HUF 6.5 billion year-over-year. The most important positive factors influencing the profit are the favourable exchange rates, decreasing energy prices and non-recurring incomes. TVK Plc’s margin income grew by 2.9 billion compared to H1 2013, which contains the change of integrated margin calculated in euro, and the changes of euro-dollar and Hungarian forint-euro exchange rates. Energy cost of TVK Plc. went down by HUF 3.1 billion due to the savings on energy prices in accordance with the price decrease of natural gas and steam, produced from natural gas. HUF 1.6 billion non-recurring incomes occurred from the insurance compensation of the fire accident in the LDPE-2 unit during 2012 and from the income on sale of the land, where the synthetic rubber plant will be constructed. Besides the favourable effects, extra costs incurred due to the technology cleaning works made in the second quarter at the Olefin-1 unit. Contrary to the last year, in this year we had no income from the CO2 quota sale and this year provisions for environmental liabilities were created, while in the last year environmental provisions were released.

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FINANCIAL STATEMENTS IN THIS REPORT ARE UNAUDITED 2

Major developments in H1 2014:

► Polymer production volume increased by 1.4%, while our own produced polymer sales did not change significantly – went down by 0.3% - year-over-year. The own produced inventory volume was 9% lower than a year before at the end of the current period.

► Capacity utilisation rate, considering the overall production facilities increased by 3 percentage points to 83% year-over-year. We could reach this level in spite of the two weeks long technology cleaning shutdown at the Olefin-1 unit and the planned maintenance shutdowns at the HDPE-2 and PP-4 units carried out in the second quarter of 2014. A year before LDPE-2 unit had a production shortfall in H1 2013 due to the fire accident in 2012.

► Due to the volatile but typically weakening Hungarian Forint exchange rates, HUF 583 million realized FX gain and HUF 624 million non-realized FX gain were recorded on receivables and payables denominated in foreign currency. In the H1 2013, we had HUF 913 million realized gain and HUF 724 million non-realized loss.

► Due to the strengthening of euro, we had HUF 653 million realized and HUF 789 million non-realized exchange loss booked on debts, credits and liabilities, denominated in foreign currency. We recorded HUF 253 million realized and HUF 416 million non-realized exchange loss in the H1 2013.

► The financial situation of the company is stable and the liquidity improved compared to the same period in 2013. The total debt of the company has decreased by HUF 866 million since the end of the year 2013. In the first half of 2013, the debt of the company, borrowed in euro, changed as follows: loans borrowed from MOL Group Finance SA decreased by EUR 17 million, at the same time in April 2014, the Company borrowed an export pre-financing loan with EUR 20 million credit limit, with favourable interest rates.

► Despite of the delay in the protracted permitting procedure the construction of the Butadiene-extraction unit still had a good progress, and the planned start of commercial operation is still feasible in May, 2015. All columns have been established in the first third of May and the inner assembly of column goes on. Construction of flare and flare pipe bridge and also of cooling tower has started with the ground work. In the Tank Park the installation of shells for spherical tanks – storage tanks for feedstock and finished products - progresses well. The test run of C4/C5 separation unit and railway load/unload unit – which units were constructed before - finished successfully.

Financial overview

Profit and Loss Statement

Consolidated net sales amounted to HUF 199,505 million that is almost 2% higher than in the first half of last year, mainly due to the higher quoted prices of polymer products and the weakening of HUF.

TVK Plc. realized 46% of its sales revenues from export sales. Italy (18%), Germany (17%), Poland (15%), Slovakia (5%), Austria (5%), Romania (5%), Ukraine (4%), and Czech Republic (4%) represented the majority of export sales.

Sales volumes and polymer sales reached similar levels compared to the previous year.

Other operating income was up by HUF 1,035 million (188%), mainly as a result of the incomes occurred from the insurance compensation of the fire accident happened in the LDPE-2 unit in October 2012, and from the income on sale of the land for the sake of construction the synthetic rubber plant. However in the H1 2013 we had HUF 327 million income from the CO2 quota sale, while we did not realized this kind of income in the H1 2014.

Production volumes increased by 1.1%, including a 1.4% growth of polymer production volume.

Raw material costs had a 3% increase year-over-year. Cost increase due to the higher volume of purchased petrochemical feedstock consumption and the higher quoted prices was moderated by the exchange rate change. At the same time, volume of purchased and processed propylene was higher than in the H1 2013. Beside a decrease in energy consumption, due to the cleaning-maintenance shutdowns; the decrease of the overall energy costs emanated from the price reduction of major energy types.

Personnel expenses were up by almost 4% in accordance with the higher headcount and due to the difference of provisions created and released.

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FINANCIAL STATEMENTS IN THIS REPORT ARE UNAUDITED 3

Other operating costs and expenses were higher by HUF 948 million (45%). The most significant factor was the created provisions for emission in the amount of HUF 140 million, while in the last year HUF 225 million environmental provision was released.

Change in inventory of finished goods and work in progress showed an increase of HUF 546 million, compared to the HUF 3,974 million decrease in the H1 2013. The higher inventory level is a result of the increased ethylene and propylene product inventory volume compared to the year-end low level, while polymer product inventory volume decreased compared to the end of the year.

The group realized HUF 1,317 million loss on financial operations, compared to the HUF 1,886 million loss in the H1 2013. Comparing the two periods, the realized and non-realized FX rate difference accounted after the loans, credits and liabilities denominated in foreign currency generated a HUF 773 million decrease in profit, whilst the revaluation of AR/AP exchange rate difference resulted in a HUF 1,018 million profit increase. The balance of interests paid and received was with HUF 221 million more favourable than in the H1 2013.

TVK Group profit before tax amounted to HUF 11,195 million in the H1 2014, representing a HUF 7,105 million year-over-year increase. The income tax was HUF 2,798 million. Consolidated net gain was HUF 8,397 million.

Balance sheet figures

The consolidated value of non-current assets increased by almost 3% compared to December 31, 2013 due to the implemented investments.

The current assets value went up by 3% compared to the beginning of the year. Inventories decreased slightly, including the value increase of the own produced olefin and polymer product inventories, counterbalanced by the lower value of the purchased stock. Accounts receivables increased by almost 2% from the beginning of the year, as a result of the higher HDPE and polypropylene product price increase. Other current assets value went down by 22% as a result of the decrease in VAT reclaim. Cash and cash equivalents were up by 63%, mainly due to the preparation for the dividend payment in July 2014.

The value of current liabilities changed favourably. However its value increased by 2% compared to 31 December 2013, which can be explained by the fact, that the dividend payment after the last year was paid on July 1, 2014, after the reporting period, and this was counterbalanced by the lower short-term loans and accounts payables. The reason of the trade payables change is the lower volume of purchased tar and the payment of the non-olefin feedstock invoices received at the end of last year.

Long term debt, net of current portion grew by 6% compared to December 31, 2013, due to the non-current stock of long term debts.

Cash flow

Operating cash flow was HUF 20,364 million, including HUF 19,056 million EBITDA. The changes in trade receivables, suppliers and inventories altogether decreased the cash flow by HUF 3,015 million, due to the factors mentioned in the balance sheet analysis.

Net cash provided by investing activities decreased the cash flow by HUF 10,547 million; within this, the highest amount is the investments value, which decreased the cash flow by HUF 11,362 million.

Net cash from financial operations decreased the cash flow by HUF 4,393 million, mainly due to the lower short-term loans and the interests paid and other financial costs.

Headcount

The total consolidated TVK headcount was 994 full time employees as of June 30, 2014. The headcount increased by 27 compared to the closing headcount on June 30, 2013, as we employed almost all future workers of the Butadiene-extraction unit.

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FINANCIAL STATEMENTS IN THIS REPORT ARE UNAUDITED 4

Capital projects

The total capital expenditure of TVK Group amounted to HUF 11,166 million in the H1 2014 – in accordance with the above mentioned cash flow on investing activities - including HUF 11,023 million expenditure incurred at TVK Plc. HUF 7,983 million was spent on the Butadiene-extraction unit. HUF 450 million was spent on the periodical maintenance works, and HUF 1,614 million was spent on activities aiming the continuous, smooth operation, while other HUF 976 million costs incurred on special corporate projects.

Major events for the period between June 30 and July 31, 2014 As of July 1, 2014 the organisation of the company changed as follows:

Based on the good experience of the former reorganisation the company modified the organisation of its financial activities. In the future, financial activities will be carried out by MOL Plc. and MOL Hungary Service Centre.

The Corporate Services has been moved directly under the control of the CEO.

Tasks of Polymer Marketing and Sales Management have been expanded with supporting the full range of petrochemical product sales. In accordance the name of the organisation has been modified to Sales and Marketing Management.

Our major strategic goals

The TVK Plc. is the largest chemical enterprise in Hungary by sales revenue. As part of the integrated MOL Downstream Division, along with Slovnaft petrochemical units in Bratislava, holds leading position in petrochemical sector in the Central Europe. Together, acting as the MOL Group petrochemical business portfolio, they are one of the ten largest polymer producers in Europe.

The key drivers, which determining our competitive power are the MOL Downstream integration benefits, the favourable geographical location, the efficient production capacities with the well-balanced product and customer portfolios. According to our ‘crude to plastic’ philosophy we optimize our refining and petrochemical production in the MOL Group level, through the whole hydrocarbon value chain. TVK and its Slovakian partner are operated along the MOL Group optimum and exploiting the benefits of integrated polymer sales. TVK produces commodity polymers in competitive quality, primarily for the European plastics processing industry, which products are fundamental for a wide range of industrial application and for production of a huge number of consumer goods that are essential to our everyday lives.

In order to maintain our leadership in the regional petrochemical market and to reach value creating and profitable business operation in the long-term, we schedule regular maintenance turnarounds and plant reconstructions that secure high level mechanical availability and excellent product quality, we launch energy efficiency improvement actions to enhance our operating efficiency and last but not least, by selectively developing of our product portfolio, we can achieve over than average returns in the regional petrochemical sector:

► We play a prominent role in the three year efficiency and competitiveness improvement program of MOL Group, named ”New Downstream” program. We realized our EBITDA growth target from our “New Downstream” actions in the first half of 2014. In order to revise and streamline our production processes we launched a Lean management program at the Olefin-2 unit this May. We expect the first outcome of the revision shortly, by August.

► BorsodChem Zrt. is our strategic partner in the ethylene sales in Hungary. In the first six months of 2014, we supplied them with the contracted volume, according our long term ethylene supply contract.

► In the first half of 2014 we carried out successful maintenance turnarounds in TVK Olefin-1, HDPE-2 and PP-4 units, covering the planned technical content and the spending was within the budget.

► We are consequently implementing our energy saving and emission reduction strategy.

► We plan to start the commercial butadiene production in our 130 kilotons/year capacity extraction unit from the end of May in 2015. Besides the butadiene production, MOL Group plan to enter the attractive segments of the synthetic rubber market, and build a 60 kilotons/year capacity synthetic rubber plant in Tiszaújváros in partnership with JSR, the Japanese synthetic rubber producer. MOL Group schedule the start of synthetic rubber production from 2017.

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FINANCIAL STATEMENTS IN THIS REPORT ARE UNAUDITED 5

Integrated Risk Management

The goal for risk management in TVK calls for making corporate operations as secure as possible. The priorities of the risk management policy of the company involve the risks associated with its business. The risk policy covers the management of currency rate and world market price risk, as well as property, business interruption, business, liability, customer, technical, safety and environmental risks.

Incorporation of the broadest variety of risks into one long-term, comprehensive and dynamic system is arranged by Enterprise Risk Management (ERM). ERM integrates financial and operational risks along with a wide range of strategic risks, also taking into consideration compliance issues and potential reputation effects. The ERM process identifies the most significant risks to the performance of the company. Risks are assessed based on a unified methodology and collected into risk maps at different levels. Risk responses and controls are reviewed and mitigation actions set and reviewed for completion regularly by top management.

As a result, senior management can get a firmer grip on the risks that influence corporate profits the most and can determine the elements of risk to retain and the ones that require a variety of risk mitigation methods.

The prices of the most important feedstock used by the company and the olefin and polymer products produced by TVK are fixed to the global market prices of the same products. From economic point of view TVK has a net long position in EUR, while it has net short USD and HUF cash flow positions.

The company had no open foreign exchange futures positions as of June 30, 2014.

The company covers most of its trade receivables with credit insurance to mitigate liquidity risk. Also, it carefully examines the credit worthiness of the prospective customers and assesses whether or not the conditions for continuous payment are attainable before signing a new contract.

In order to exploit opportunities of the portfolio effects, TVK’s financial risk exposures (e.g. commodity, FX rates, interests rates) are managed on MOL Group level.

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FINANCIAL STATEMENTS IN THIS REPORT ARE UNAUDITED 6

Tisza Chemical Group Public Limited Company and Subsidiaries

Unaudited, Consolidated Financial Statements prepared in accordance with International Financial Reporting Standards

June 30, 2014

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FINANCIAL STATEMENTS IN THIS REPORT ARE UNAUDITED 7

ANNEXES

ANNEX 1 CONSOLIDATED INCOME STATEMENTS FOR TVK GROUP

prepared in accordance with IFRS for the period ended 30 June 2014 unaudited figures (in HUF million)

Year 2013

(audited)

Q2 2013

(restated)

Q2 2014

Change Q2 2014/ Q2 2013

%

H1 2013

(restated)

H1 2014

Change H1 2014/ H1 2013

%

402,490 Net revenue 98,752 98,931 0.2 196,005 199,505 1.8

704 Other operating income 62 1,561 2,417.7 549 1,584 188.5

403,194 Total operating revenues 98,814 100,492 1.7 196,554 201,089 2.3

331,834 Material costs 76,432 78,083 2.2 159,054 163,952 3.1

14,717 Material type services 3,834 3,658 (4.6) 7,096 6,974 (1.7)

16,216 Cost of goods sold 3,815 2,629 (31.1) 7,897 4,642 (41.2)

99 Cost of services sold 41 10 (75.6) 79 22 (72.2)

362,866 Raw materials and consumable used 84,122 84,380 0.3 174,126 175,590 0.8

8,167 Personnel expenses 2,078 2,285 10.0 4,088 4,244 3.8

13,529 Depreciation, amortization and impairment 3,350 3,196 (4.6) 6,805 6,544 (3.8)

5,096 Other operating expenses 476 1,699 256.9 2,093 3,041 45.3

4,199 Change in inventory of finished goods and work in progress 5,472 1,851 (66.2) 3,974 (546) -

(1,417) Work performed by the enterprise and capitalised (483) (242) 49.9 (508) (296) 41.7

392,440 Total operating expenses 95,015 93,169 (1.9) 190,578 188,577 (1.0)

10,754 Profit from operation 3,799 7,323 92.8 5,976 12,512 109.4

685 Financial income 78 357 357.7 230 1,393 505.7

3,685 Financial expense 74 912 1,132.4 2,116 2,710 28.1

(3,000) Financial (expense) / gain, net 4 (555) - (1,886) (1,317) 30.2

0 Income from associates 0 0 - 0 0 -

7,754 Profit before tax 3,803 6,768 78.0 4,090 11,195 173.7

2,093 Income tax expense 1,147 1,734 51.2 1,413 2,798 98.0

5,661 Profit for the period 2,656 5,034 89.5 2,677 8,397 213.7

5,661 Profit attributable to equity holders of the parent 2,656 5,034 89.5 2,677 8,397 213.7

0 Non-controlling interest 0 0 - 0 0 -

ANNEX 2 CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR TVK GROUP

prepared in accordance with IFRS for the period ended 30 June 2014 unaudited figures (in HUF million)

Statement of comprehensive income H1 2013

(restated) H1 2014

Profit for the year 2,677 8,397

Other comprehensive income

Exchange differences on translating foreign operations (12) (12)

Actuarial gain /( loss) on provisions for retirement benefit obligations, net of tax 7 1

Other comprehensive income for the year, net of tax (5) (11)

Total comprehensive income for the year 2,672 8,386

Attributable to:

Equity holders of the parent 2,672 8,386

Non-controlling interest 0 0

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FINANCIAL STATEMENTS IN THIS REPORT ARE UNAUDITED 8

ANNEX 3 OTHER FACTORS AND COSTS INFLUENCING PROFIT AND LOSS STATEMENT DATA

prepared in accordance with IFRS for the period ended 30 June 2014 unaudited figures (in HUF million)

Factors influencing product sales of TVK Plc.

H1 2014 – H1 2013 (HUF million)

Effect of variance in price

Effect of variance in exchange rates

Effect of variance in volume

Total

Olefin (884) 1,745 (3,769) (2,908)

LDPE 189 349 11,598 12,136

HDPE (875) 2,399 (10,284) (8,760)

PP 2,241 1,917 (463) 3,695

Total 671 6,410 (2,918) 4,163

Distribution of TVK Group sales incomes by production units H1 2014 (HUF million)

Domestic sales Export sales Total sales

Olefin 66,671 1,545 68,216

LDPE 5,056 9,549 14,605

HDPE 6,026 54,802 60,828

PP 26,523 25,653 52,176

Income from other business activities 4,863 85 4,948

Effect of consolidation (1,302) 34 (1,268)

Total 107,837 91,668 199,505

Variances in key feedstock costs incurred by TVK Plc. H1 2014 – H1 2013 (HUF million)

Effect of variance in

price

Effect of variance in exchange rates

Effect of variance in

volume

Total

Naphtha and light hydrocarbons in total 6,083 (313) 7,366 13,136

Gas oil 0 0 (4,085) (4,085)

Chemical feedstock in total 6,083 (313) 3,281 9,051

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FINANCIAL STATEMENTS IN THIS REPORT ARE UNAUDITED 9

ANNEX 4 CONSOLIDATED BALANCE SHEETS FOR TVK GROUP

prepared in accordance with IFRS for the period ended 30 June 2014 unaudited figures (in HUF million)

30.06.2013.

restated 31.12.2013.

audited 30.06.2014. Change

30.06.2014/ 31.12.2013

%

ASSETS

Non-current assets 119,161 126,091 129,255 2.5

Intangible assets 2,067 2,081 1,975 (5.1)

Property, plant and equipment 115,288 118,331 123,130 4.1

Investments in associated companies 0 0 0 -

Deferred tax asset 1,356 1,536 734 (52.2)

Other non-current assets 450 4,143 3,416 (17.5)

Current assets 87,110 92,078 94,408 2.5

Inventories 12,120 13,341 13,283 (0.4)

Trade receivables, net 54,009 52,921 53,759 1.6

Securities 227 0 0 -

Other current assets 14,618 16,831 13,188 (21.6)

Prepaid taxes 10 285 13 (95.4)

Cash and cash equivalents 6,126 8,700 14,165 62.8

TOTAL ASSETS 206,271 218,169 223,663 2.5

EQUITY AND LIABILITIES

Equity attributable to equity holders of the parent 118,059 121,047 123,232 1.8

Share capital 24,534 24,534 24,534 0.0

Reserves 90,848 90,852 90,301 (0.6)

Profit for the year attributable to equity holders of the parent 2,677 5,661 8,397 48.3

Equity attributable to equity holders of the parent 118,059 121,047 123,232 1.8

Non-controlling interest 0 0 0 -

Non-current liabilities 40,105 33,680 35,666 5.9

Long-term debt, net of current portion 37,899 31,508 33,456 6.2

Provisions 2,147 2,140 2,184 2.1

Deferred tax liabilities 0 0 0 -

Other non-current liabilities 59 32 26 (18.8)

Current liabilities 48,107 63,442 64,765 2.1

Trade and other payables 39,308 53,472 56,548 5.8

Taxes payable 729 0 1,548 -

Provisions 504 676 461 (31.8)

Short-term debt 6,358 5,668 3,000 (47.1)

Current portion of long-term debt 1,208 3,626 3,208 (11.5)

TOTAL EQUITY AND LIABILITIES 206,271 218,169 223,663 2.5

Significant Off-Balance Sheet Items

1

Please see Note No. 15 in the annex 7 - Notes to the interim financial statements.

1 Any financial liabilities have material importance in respect of financial evaluation but not reflected in the balance sheet (e.g. surety, guarantees given, liabilities under lien, etc.)

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FINANCIAL STATEMENTS IN THIS REPORT ARE UNAUDITED 10

ANNEX 5 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR TVK GROUP

prepared in accordance with IFRS for the period ended 30 June 2014 unaudited figures (in HUF million)

Shar

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Opening balance 1 January 2013 (restated) 24,534 15,022 17 83,393 (7,579) - 115,387

Retained profit of the reporting period - - - - 2,677 - 2,677

Other comprehensive income of the reporting period together with tax effect - - (12) 7 - - (5)

Total comprehensive income of the reporting period - - (12) 7 2,677 - 2,672

Transfer of retained profit of the previous period - - - (7,579) 7,579 - -

Dividend paid to shareholders - - - - - - -

Other - - - - - - -

Closing balance 30 June 2013 (restated) 24,534 15,022 5 75,821 2,677 - 118,059

Opening balance 1 January 2014 24,534 15,022 5 75,825 5,661 - 121,047

Retained profit of the reporting period - - - - 8,397 - 8,397

Other comprehensive income of the reporting period together with tax effect - - (12) 1 - - (11)

Total comprehensive income of the reporting period - - (12) 1 8,397 - 8,386

Transfer of retained profit of the previous period - - - 5,661 (5,661) - -

Dividend paid to shareholders - - - (6,201) - - (6,201)

Other - - - - - - -

Closing balance 30 June 2014 24,534 15,022 (7) 75,286 8,397 - 123,232

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FINANCIAL STATEMENTS IN THIS REPORT ARE UNAUDITED 11

ANNEX 6 CONSOLIDATED STATEMENTS OF CASH FLOWS FOR TVK GROUP

prepared in accordance with IFRS for the period ended 30 June 2014 unaudited figures (in HUF million)

31.12.2013. (audited)

Description 30.06.2013. (restated)

30.06.2014.

7,754 Profit before tax 4,090 11,195

Adjustments to reconcile profit before tax to net cash provided by operating activities

13,529 Depreciation, amortisation and impairment 6,805 6,544

139 Write-off / reversal of write(off) of inventories, net 18 (44)

(967) Increase/(decrease) in provisions (1,137) (169)

(379) Net (gain)/loss on sale of property, plant and equipment (378) (662)

50 Impairment / reversal of write(off) of receivables 38 20

0 Profit on the sales of subsidiaries 0 0

(81) Interest income (34) (21)

2,439 Interest on borrowings 1,254 1,019

368 Net foreign exchange (gain) / loss on foreign currency loan and other financial items 482 236

167 Other financial (gain)/ loss, net 130 44

547 Other non cash items 550 458

23,566 Operating cash flow before changes in working capital 11,818 18,620

3,980 (Increase) / decrease in inventories 5,322 103

(3,186) (Increase) / decrease in trade receivables (4,418) 454

1,876 (Increase) / decrease in other current assets 3,956 3,634

(8,963) Increase / (decrease) in trade payables (19,172) (3,572)

1,650 Increase / (decrease) in other payables 1,338 1,303

(2,176) Income taxes paid (311) (178)

16,747 Net cash provided (used in) by operating activities (1,467) 20,364

(14,770) Capital expenditures (4,973) (11,362)

590 Proceeds from disposals of property, plant and equipment 589 674

241 Proceeds from disposal / withdrawal of financial investments 11 0

(184) Changes in loans given and long-term bank deposits 0 9

0 Changes in short-term investments 0 0

97 Interest received and other financial income 42 132

0 Dividend received 0 0

(14,026) Net cash flows used in investing activities (4,331) (10,547)

59,137 Long-term debt drawn down 8,857 47,062

(54,105) Repayments of long-term debt (595) (47,129)

(5) Changes in other long-term liabilities 22 0

(3,205) Changes of short-term debt (1,649) (2,668)

(2,274) Interest paid and other financial costs (1,156) (1,658)

0 Dividend paid to shareholders 0 0

(452) Net cash (used in) / provided by financing activities 5,479 (4,393)

2,269 Increase / (decrease) in cash and cash equivalents (319) 5,424

6,440 Cash and cash equivalents at the beginning of the period 6,440 8,700

3 Exchange differences of cash and cash equivalents of consolidated foreign subsidiaries 2 (12)

(12) Unrealized foreign exchange difference on cash and cash equivalents 3 53

8,700 Cash and cash equivalents at the end of the period 6,126 14,165

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ANNEX 7 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS IN ACCORDANCE WITH THE INTERNATIONAL

FINANCIAL REPORTING STANDARDS

1. General information

Tiszavidéki Vegyi Kombinát, TVK’s legal predecessor was founded in 1953. In 1961 it was transformed into a state-owned company called Tiszai Vegyi Kombinát (the “state-owned company”). Prior to its privatisation, the state-owned company was incorporated as a public limited company on 31 December 1991 (the “Company”). In accordance with the law on the transformation of unincorporated state-owned enterprises, the assets and liabilities of TVK were revalued as at that date.

As at 31 December 1995, the Company was 99.92% owned by the Hungarian State Privatisation and Holding Company (“ÁPV Rt.”) and the remaining 0.08% was owned by local municipalities.

In 1996, the Company was privatised through an offering of shares owned by ÁPV Rt. to foreign and domestic institutional and private investors.

Following this privatisation, shares of the Company were listed on the Budapest Stock Exchange and Global Depository Receipts (“GDRs”) representing the shares were listed on the London Stock Exchange. As of 30 June 2014, MOL Plc. holds the majority of the shares.

The Company, with its registered seat in Tiszaújváros (H-3581 Tiszaújváros, TVK-Ipartelep TVK Központi Irodaház 2119/3. hrsz. 136. épület), produces chemical raw materials including ethylene, propylene and polymers of these products for both domestic and foreign markets.

2. Basis of preparation

The interim condensed financial statements for the six months ended 30 June 2014 have been prepared in accordance with International Accounting Standard 34 Interim Financial Reporting.

The interim condensed consolidated financial statements do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with the Group’s annual financial statements as at 31 December 2013.

3. Significant accounting policies

The accounting policies adopted in the preparation of the interim condensed consolidated financial statements are consistent with those followed in the preparation of the Group’s annual financial statements for the year ended 31 December 2013, except for the adoption of new or amended standards, and interpretations effective from 1 January 2014.

Obligatory changes in IFRS, effective from 1 January 2014, were adopted by the Group for the purposes of this Report. These changes have no significant effect on the financial statements.

Since the end of the year 2013, the Group elected to reclassify foreign exchange differences on trade debtors and creditors from operating results to financial results, since the Group believes that with this amendment operating results more effectively demonstrate the core business performance. In line with this amendment, comparative periods were restated, and the impact on the operating result was HUF (189) million loss in the H1 2013.

4. Seasonality

Seasonality doesn’t influence the Group’s operation.

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5. Operating segment information For management purposes the Group is organised into two major operating business units: Petrochemicals and Corporate and other. The business units are the basis upon which the Group reports its segment information to the management who is responsible for allocating business resources and assessing performance of the operating segments. During the interim period, the identification of the Group’s operating segments has remained the same as at 31 December 2013.

Six months ended 30 June 2014 Petrochemicals Corporate and other

Inter-segment transfers

Total

HUF million HUF million HUF million HUF million

Net Revenue

Sales to external customers 199,181 324 - 199,505

Inter-segment sales 141 894 (1,035) -

Total revenue 199,322 1,218 (1,035) 199,505

Results

Profit/(loss) from operations 12,802 (290) - 12,512

Financial income / (expense), net - - - (1,317)

Income from associates - - - -

Profit before tax - - - 11,195

Income tax expense/(benefit) - - - 2,798

Profit for the year - - - 8,397

Six months ended 30 June 2013 Petrochemicals Corporate and other

Inter-segment transfers

Total

HUF million HUF million HUF million HUF million

Net Revenue

Sales to external customers 195,531 474 - 196,005

Inter-segment sales 181 938 (1,119) -

Total revenue 195,712 1,412 (1,119) 196,005

Results

Profit/(loss) from operations 6,925 (949) - 5,976

Financial income / (expense), net - - - (1,886)

Income from associates - - - -

Profit before tax - - - 4,090

Income tax expense/(benefit) - - - 1,413

Profit for the year - - - 2,677

30 June 2014 Petrochemicals Corporate and other

Inter-segment transfers

Total

HUF million HUF million HUF million HUF million

Assets and liabilities

Property, plant and equipment, net 118,534 4,596 - 123,130

Intangible assets, net 1,631 344 - 1,975

Inventories 13,196 87 - 13,283

Trade receivables, net 53,646 113 - 53,759

Investments in associates - - - -

Not allocated assets - - - 31,516

Total assets - - - 223,663

Trade payables 42,407 192 - 42,599

Not allocated liabilities - - - 57,832

Total liabilities - - - 100,431

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30 June 2013

Petrochemicals

Corporate and

other

Inter-segment transfers Total

HUF million HUF million HUF million HUF million

Assets and liabilities

Property, plant and equipment, net 110,579 4,709 - 115,288

Intangible assets, net 1,864 203 - 2,067

Inventories 12,039 81 - 12,120

Trade receivables, net 53,925 84 - 54,009

Investments in associates - - - -

Not allocated assets - - - 22,787

Total assets - - - 206,271

Trade payables 31,816 107 - 31,923

Not allocated liabilities - - - 56,289

Total liabilities - - - 88,212

6. Sales transactions

Transactions in current period

There was no investment sale.

7. Tangible assets

The Group purchased tangible assets in the value of HUF 11,166 million in the first half of 2014. This value was HUF 2,336 million in the same period of 2013.

Depreciation over the plan amounted to HUF 9 million in the period under review.

Pledged assets

None of the assets of the Company were pledged as of 31 December 2013 and 30 June 2014. Assets of TVK Erőmű Kft. (HUF 8,169 million) and assets of Tisza-WTP Kft. (HUF 977 million) are pledged as collateral for long-term investment loans.

8. Inventories

The impairment of inventories in the interim period amounted to HUF 44 million on Group level.

9. Provisions

The consolidated provisions amounted to HUF 2,645 million on June 30, 2014, HUF 171 million less than as at December 31, 2013. The change can be explained by decrease in provisions for GHG emission surplus due to utilization (HUF 333 million), and creation of provision for environmental liabilities (HUF 173 million).

10. Share capital

Share capital as of 30 June 2014 was as follows:

Shareholder Number of

shares Face value Total Shareholding

(HUF) (HUF million) (%)

Domestic entities 23,382,430 1,010 23,616 96.26

International entities 269,801 1,010 273 1.11

Domestic private investors 628,879 1,010 635 2.59

International private investors 7,003 1,010 7 0.03

Unregistered investors 2,730 1,010 3 0.01

Total 24,290,843 24,534 100.00

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11. Debts

Long-term debt as of 31 December 2013 and 30 June 2014 were as follows:

Weighted average

interest rate Weighted average

interest rate Due date

Amount Amount

31.12.2013. 30.06.2014. 31.12.2013. 30.06.2014.

% % HUF million HUF million

Secured bank loan of TVK Erőmű Kft. in EUR* 1.06 1.14 2018 4,986 4,662

Secured bank loan of Tisza-WTP Kft. in EUR** 1.06 1.14 2017 813 753

Unsecured loan in EUR from MOL Finance Company*** 4.62 4.57 2017 23,456 19,232

Unsecured loan in EUR of TVK Plc.*** 1.60 1.60 2018 2,969 2,791

Unsecured loan in EUR of TVK Plc.*** 1.65 2019 - 6,204

Other**** 2,910 3,022

Total long term debt 35,134 36,664

Current portion of long-term debt 3,626 3,208

Total long-term debt, net of current portion 31,508 33,456 *On 26 July 2002, TVK Erőmű Kft. signed a project financing agreement with OTP Bank Rt., and the facility, that amounted to HUF 9,810 million (EUR 40 million), had been fully drawn by 31 December 2004. The loan is secured by a pledge on TVK Erőmű Kft’s assets. ** In order to implement a water treatment plant to be operated by Tisza WTP Kft., on 17 December 2002, the Kft. signed a long-term project and development loan agreement for HUF 1,883 million (EUR 8 million) with OTP Bank Rt. By the end of the availability period (29 December 2003), the Kft. had drawn down a total of EUR 7,340,000 from the facility. The project loan is secured by the Company’s assets. *** On 21 December 2009, a revolving loan contract was made between TVK Plc. and MOL Plc. in an amount of EUR 100 million. The company modified the loan contract and divided the credit line into long term part (EUR 70 million) and short term part (EUR 30 million) during 2011. On April 2, 2013, TVK Plc. concluded a long term revolving credit contract of EUR 100 million with MOL Group Finance SA, at the same time former loan contract concluded with MOL Plc. has been withdrawn. Due to the modifications of the long term loan contract on May 20, 2014 and the short term loan contract on 31 March, 2014, the conditions of loans became more favourable. In 2013, TVK Plc. contracted a long term pre-financing loan facility for export activity in an amount of EUR 10 million. In the H1 2014 TVK Plc. repaid one million euro from this loan. In 2014, TVK Plc. borrowed an export pre-financing loan with EUR 20 million credit limit with favourable interest rates. **** According to service agreement the shareholding of the majority owners of the capital of TVK Erőmű Kft. and Tisza WTP Kft. is to be reimbursed during the lifetime of the project, and is recorded as other long-term debt in accordance with IAS 32, as it qualifies as a financial liability.

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12. Financial (income) / expense

The financial income / (expense) for the period ended 30 June 2014 and 2013 was as follows (in HUF million):

H1 2013 H1 2014

Foreign exchange gain of loans, net - 155

Foreign exchange gain of account receivables and trade payables, net 189 1,207

Interest received 34 21

Impairment, reverse impairment and revaluation of securities - -

Non hedging transaction - -

Other 7 10

Total financial income 230 1,393

Interest expense* 1,254 1,020

Foreign exchange loss of loans 669 1,597

Loss on sale of investments 121 -

Interest on provision 53 39

Commitment fee of bank loans 19 52

Other - 2

Total financial expenses 2,116 2,710

Total financial income / (expense), net (1,886) (1,317) * Interest expense of the Group for the H1 2014 includes HUF 194 million (on 30 June 2013: HUF 413 million), being the share from the net income of TVK Erőmű Kft. of its majority shareholder (ÉMÁSZ Nyrt.), and Tisza WTP Kft. of shareholder (Sinergy Kft.).

13. Income taxes

Total applicable income taxes reported in the consolidated financial statements include the following components (in HUF million):

H1 2013 H1 2014

Current corporate income taxes* 430 1,217

Local trade tax 572 612

Innovation fee 86 92

Surplus tax 78 76

Deferred income taxes 247 801

Total income tax expense / (benefit) 1,413 2,798 * The amount id current corporate income tax includes the income taxes of the consolidated companies.

14. Earnings per share (EPS)

The Group’s earnings per share based on consolidated information for 30 June 2013 and 2014 are as follows:

30 June 2013 30 June 2014

Net income, IFRS (million HUF) 2,677 8,397

Weighted average of shares outstanding in the period (pieces) 24,290,843 24,290,843

EPS (HUF 1,010 face value) HUF 110 HUF 346

The average number of ordinary shares was determined based on the weighted mathematical average method. Diluted EPS is the same as undiluted EPS as the Company has no diluting instruments or purchase options.

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15. Commitments and contingency liabilities Capital and contractual commitments The total value of capital commitments as of 30 June 2014 was HUF 24,638 million, which is fully attributable to TVK Plc. Gas Purchase Obligation, Take or Pay Contract The TVK Erőmű Kft. has concluded long-term gas purchase contract with MOL Energiakereskedő Zrt. in order for continuous operation of equipment in the power plant. As of 30 June 2014, 348 million cubic meters of natural gas will be purchased during the period ending 2018 based on this contract (from which 296 mcm under take-or-pay commitment calculated with an average price). TVK Plc. signed a long-term natural gas purchase contract with MOL Plc. and MOL Energiakereskedő Zrt. The buyers (TVK Plc. and MOL Plc.) engage themselves to receive and pay the annual minimum quantity, which is the 85% of the contractual annual quantity. As of 30 June 2014, 83 million cubic meters of natural gas will be purchased during the period ending 2015 based on this contract. The Company concluded an agreement with MOL Plc. About the purchase of gas with high inert gas content, undertaking obligations from 2012 to 2016. The buyers engage themselves to receive and pay the annual minimum quantity, which is the 85% of the contractual annual quantity. As of 30 June 2014, 2,631 TJ high inert content gas will be purchased during the period ending 2016 based on this contract. The Company concluded an agreement with MOL Plc. for purchasing full electricity supply for 2014 which will be provided to users other than the TVK industry area. The buyer engages itself to receive and pay the annual minimum quantity, which is the 75% of the contractual annual quantity. The contract relates to the purchase of 0.204 GWh of electricity in 2014. Company also concluded a long-term frame agreement with MOL Plc. Consumption of next year is determined and concluded annually as a take-or-pay obligation. Environmental protection The Company recognized environmental provision based on the currently available quantifiable future expenses in the amount of HUF 2,147 million as of 30 June 2014 (31 December 2013: HUF 1,974 million). Beyond the provision recognized in the Balance Sheet, there are further contingent environmental liabilities whose amount may exceed HUF 4 billion. There is no legal obligation to carry these contingent environmental liabilities out, their exact technical content is uncertain and we consider the probability of having these tasks completed is less than 50%.

16. Related party transactions TVK Group realized sales revenues of HUF 45,020 million in the first six months of 2014 from MOL Group. As at June 30, 2014 accounts receivable of HUF 10,379 million and accounts payable of HUF 35,056 million are recorded in respect of MOL Group.

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ANNEX 8

CONSOLIDATED COMPANIES

Name Equity/

Registered Capital

Interest held (%)

Ratio of votes

1

Classification2

TVK Ingatlankezelő Kft. (HUF thousand) 1,620,000 100.00% L L

TVK Erőmű Termelő és Szolgáltató Kft. (HUF thousand) 2,218,400 26.00% T L

TVK FRANCE S.a.r.l. (EUR) 76,225 100.00% L L

Tisza-WTP Vízelőkészítő és Szolgáltató Kft. (HUF thousand)* 405,000 - - L 1 Voting rights entitling the holder to participate in decision making at the general meetings of consolidated companies 2 Full (L); Jointly managed (K); Associated (T) The ratio of votes corresponds to the ratio of ownership in each case. * Non-participating business with full consolidation.

ANNEX 9 MAJOR EXTERNAL FACTORS

Q2

2013 H1

2013 Q1

2014 Q2

2014 H1

2014

Ch. % Q2 2014/ Q2 2013

Ch. % Q2 2014/ Q1 2014

Ch. % H1 2014/ H1 2013

Naphtha FOB med USD/t 804 858 885 916 901 3.5 13.9 4.9

AGO 0.1 CIF med USD/t 872 916 918 911 915 (0.7) 4.5 (0.2)

Ethylene ICI's lor fd NEW contract EUR/t

1,200 1,246 1,209 1,165 1,187 (3.7) (2.9) (4.7)

Propylene ICI's lor fd NWE contract EUR/t

1,057 1,086 1,130 1,149 1,140 1.7 8.8 5.0

LDPE Film ICI's lor fd NWE low EUR/t 1,241 1,277 1,284 1,279 1,282 (0.4) 3.1 0.4

HDPE Film ICI's lor fd NWE low EUR/t 1,196 1,255 1,215 1,221 1,218 0.4 2.1 (2.9)

HDPE Blow ICI's lor fd NWE low EUR/t 1,197 1,252 1,215 1,218 1,216 0.3 1.7 (2.9)

PP Homo raffia ICI's lor fd NWE low EUR/t

1,186 1,204 1,238 1,278 1,258 3.3 7.8 4.5

PP Homo Injection ICI's lor fd NWE low EUR/t

1,187 1,205 1,238 1,283 1,260 3.7 8.1 4.6

PP Copolymer ICI's lor fd NWE low EUR/t

1,224 1,239 1,281 1,327 1,304 3.6 8.4 5.2

EUR/HUF 295.75 296.08 307.90 305.94 306.94 (0.6) 3.4 3.7

USD/HUF 226.39 225.45 224.74 223.09 223.93 (0.7) (1.5) (0.7)

EUR/USD 1.306 1.313 1.370 1.371 1.371 0.1 5.0 4.4

Integrated petrochemical margin 332 322 318 304 311 (4.3) (8.4) (3.4)

Note: Data in the table are rounded, but changes are calculated without rounding.

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ANNEX 10 STRUCTURE OF OWNERSHIP AND TREASURY SHARES

Shareholder structure, ownership and voting right

Description of owner Total equity and Listed series

31.12.2013. 30.06.2014.

Ownership and voting rights %

No. of shares Ownership and voting rights %

No. of shares

MOL Magyar Olaj- és Gázipari Nyilvánosan Működő Részvénytársaság 94.86 23,042,385 94.86 23,042,385

Other domestic institution/company 2.56 620,701 1.40 340,045

Foreign institution/company 1.12 271,670 1.11 269,801

Domestic individual 1.23 299,364 2.59 628,879

Foreign individual 0.02 5,735 0.03 7,003

Treasury shares - - - -

Shares held by unidentified parties 0.21 50,988 0.01 2,730

TOTAL 100.00 24,290,843 100.00 24,290,843 Notes: Please note that in Hungary, the Share Register does not fully reflect the ownership structure, as registration is not mandatory. Every ordinary share with a par value of HUF 1,010 (i.e. one thousand ten forint) entitles the holder thereof to have one and one hundredth vote.

ANNEX 11 EMPLOYEES

Changes in the Number of Full Time Employees

Reference Period Ended June 30, 2013

Year Opening January 1, 2014

Period Closing June 30, 2014

Corporate level 961 969 988

Group level 967 975 994

ANNEX 12 CHANGES IN ORGANISATION AND SENIOR MANAGEMENT

The information on change in the organisation as of July 1, 2014 can bee seen on page 4. Changes in the senior management of the Company in the first quarter: As from April 15, 2014 Ákos Székely Ph.D. is the Chief Financial Officer of TVK Plc.

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ANNEX 13

REGULATED INFIORMATIONS IN 2014

The Company information mentioned below is available at the website of the Company (www.tvk.hu) below the Investor Relations item. Places of the disclosures are: the websites of TVK (www.tvk.hu), of the Budapest Stock Exchange (www.bse.hu), the Capital Market Disclosure website (www.kozzetetelek.hu) and the website of the London Stock Exchange (www.londonstockexchange.com ).

Announcement date Content

2 January, 2014 Number of voting rights at TVK Plc.

31 January, 2014 Number of voting rights at TVK Plc.

18 February, 2014

Extraordinary announcement about change in the senior management of the company

(Production manager)

25 February, 2014 Report on the full year 2013 results of TVK Group

3 March, 2014 Number of voting rights at TVK Plc.

14 March, 2014 Remuneration of members of the Board of Directors and of the Supervisory Board in 2013

as cash and non-cash benefit

14 March, 2014 Announcement by the Board of Directors of TVK Plc. on the convocation of the company’s

ordinary general meeting in 2014

24 March, 2014 TVK – AGM documents

31 March, 2014 Number of voting rights at TVK Plc.

14 April, 2014 Extraordinary announcement about change in the senior management of the company

(CFO)

15 April, 2014 2014 Annual General Meeting resolutions of TVK Plc.

15 April, 2014

TVK Group Corporate Governance Report for 2013 in accordance with Budapest Stock

Exchange Corporate Governance Recommendations

15 April, 2014 Annual Report of TVK Plc. prepared on the business year 2013

16 April, 2014 Summary report of TVK Plc. on the business year 2013

30 April, 2014 Number of voting rights at TVK Plc.

30 April, 2014 Financial Statements and Business Reports of TVK Plc. prepared on the business year 2013

8 May, 2014 TVK Group Interim Management Report on the Q1 2014

30 May, 2014 Announcement of the Board of Directors of TVK Plc. regarding the dividend payment for

the financial year of 2013

2 June, 2014 Number of voting rights at TVK Plc.

2 June, 2014 Articles of Association of TVK Plc. (15.04.2014)

1 July, 2014 Number of voting rights at TVK Plc.

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ANNEX 14

ELECTED OFFICERS AND TOP MANAGEMENT AND TREASURY SHARES HELD

Name Position Beginning of assignment

End /termination/ term of

assignment

TVK shares

held (qty)

Board of Directors

György Mosonyi Chairman of the Board 26.04.2002 17.04.2017 0

Ferenc Horváth Board member 01.05.2011 30.04.2016 0

Gyula Gansperger Board member 20.04.2006 20.04.2016 0

Miklós Kamarás Board member 01.05.2011 30.04.2016 0

László Madarász Board member 01.05.2013 30.04.2018 0

dr. Péter Medgyessy Board member 20.04.2006 20.04.2016 0

dr. Zoltán Nagy Board member 01.05.2011 30.04.2016 0

Zsolt Pethő Board member 17.04.2012 17.04.2017 0

Supervisory Board

László Gyurovszky SB chairperson SB member

22.06.2007 19.04.2007

17.04.2017 17.04.2017

0

dr. Gyula Bakacsi SB member 19.04.2007 17.04.2017 0

dr. György Bíró SB member 19.04.2007 17.04.2017 0

László Réti SB member, employee representative 29.04.2010 29.04.2015 0

Judit Turóczy SB member, employee representative 21.04.2011 20.04.2016 0

Top management

Zsolt Pethő Chief Executive Officer 01.06.2011 Indefinite term 0

Zsolt Huff Production Director 01.03.2014 Indefinite term 0

Adrienn Ráczné Bodnár Human Resources Manager 03.01.2012 Indefinite term 0

Péter Suba TVK Development Manager 02.01.2013 Indefinite term 0

Ákos Székely Ph. D. Chief Financial Officer 15.04.2014 Indefinite term 0

Dragan Szimics Sales and Marketing Manager 01.09.2013 Indefinite term 0

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STATEMENT OF RESPONSIBILITY

We the undersigned representatives authorized to sign on behalf of Tisza Chemical Group Public

Limited Company (TVK Plc.), the issuer of TVK ordinary shares, hereby declare that TVK Plc. accepts

full liability for having prepared the disclosed Report on the first half year 2014 results of TVK

Group on the basis of the applicable accounting standards and to the best knowledge of the

company, and it offers a true and fair picture of the assets, liabilities, financial position, profits and

losses of TVK Plc. (and its consolidated businesses); and the reliable account of the position,

development and performance of TVK Plc. (and its consolidated businesses) through a description

of key risks and factors of uncertainty.

Tiszaújváros, July 31, 2014

Zsolt Pethő Ákos Székely Ph.D. Chief Executive Officer member of the Board

Chief Financial Officer